Emmanuel THIBAULT (GREQAM, UniversitŽ de la MŽditŽrranŽe)
Abstract
We consider an OLG model with production and altruistic agents initially developed by Barro (1974). Through a simple example, we show that, contrary to the intuition of Abel (1987) and Weil (1987), an increase in the degree of altruism can result in a decrease in the stationary level of bequests even if the Diamond model has a unique and stable steady state. To rule out this counterintuitive case, an assumption on the curvature of the production function is necessary.
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Find related papers by JEL classification: C62 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Existence and Stability Conditions of Equilibrium D91 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Consumer Choice; Life Cycle Models and Saving O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
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